Church Foreclosure Fight

Embroiled in foreclosure proceedings that stretch back to 2008, Evangelical Christian Credit Union is still in the midst of a legal fight against was once one of Florida's largest churches.

In the latest round in the commercial real estate saga, the $1 billion Evangelical Christian in Brea, Calif., filed a Dec. 31 motion requesting a ruling seeking foreclosure of Without Walls International Church in Lakeland, Fla., according to clerk of county records in Polk County, Fla. At press time, a judge had not issued a ruling on that motion.

Meanwhile, on Feb. 3, a judge approved a motion filed by Anthony & Partners, the Tampa, Fla.-based law firm representing Without Walls, to withdraw its counsel services, citing irreconcilable differences, court records showed. The church also requested 30 days to seek new attorneys.

Despite the recent legal moves, Without Walls has continued to collect fines for code violations for broken windows, deteriorating light poles and fences and missing roof sections, according to local media reports. At last count, the church had accrued $4,500 in fines and is being assessed $100 each day until the repairs are made. The property, which has sat dormant since August 2011, still owes a $32,000 utility bill, records show.

Without Walls initially went into foreclosure in 2008 owing Evangelical Christian $13.9 million, which was due in September 2012. In 2009, the credit union approved a mortgage modification for the church.

Without Walls filed a complaint in October 2012 against Evangelical Christian seeking more than $23.8 million with claims that the credit union acted inappropriately towards the church's founder, Randy White, by allowing his ex-wife, Paula White, to take more than $2 million worth of video and music equipment from the church to use for her own ministry, according to local media reports. Paula White was hired as senior pastor at a church in Orlando.

The Without Walls’ complaint also said Evangelical Christian allegedly made false statements about the church in order to thwart a deal initiated by Randy White to sell the property.

In the summer of 2013, Without Walls was up for sale for $14.75 million, according to real estate filings. The property, which has 63 acres and houses the 9,600-seat church, was initially bought in 2005 for $8 million.

A comment from Evangelical Christian was not available.

In a 2009 article titled “Crisis and Faith” featured in a leadership education publication from Duke University, Mark Holbrook, president of Evangelical Christian, offered his take on the growing number of church foreclosures.

“Certainly, this is unprecedented in our history,” Holbrook said. “Because of the grace factor, churches tend to put off hard decisions,” he added referring to how some churches may see their soured financials as a sign of wavering spiritual faith.

Holbrook said at 14%, the capital requirement for credit unions with a concentration in member business loans is too high and higher than the threshold for commercial banks. He worried that the proposed risk-based capital rule would send Evangelical Christian from being a well-capitalized credit union into undercapitalized territory overnight.